These non-GAAP measures are included solely for informational and comparative purposes and are not meant as a substitute for GAAP and should be considered together with the consolidated financial information located in the tables attached to this press release.
About Lattice Semiconductor Corporation:
Lattice Semiconductor (NASDAQ: LSCC) is the low power programmable leader. We solve customer problems across the network, from the Edge to the Cloud, in the growing communications, computing, industrial, automotive and consumer markets. Our technology, long-standing relationships, and commitment to world-class support lets our customers quickly and easily unleash their innovation to create a smart, secure and connected world.
For more information about Lattice, please visit www.latticesemi.com. You can also follow us via LinkedIn, Twitter, Facebook, YouTube, WeChat, Weibo or Youku.
Lattice Semiconductor Corporation Consolidated Statements of Operations (in thousands, except per share data) (unaudited) |
||||||||||||
|
|
Three Months Ended |
|
|||||||||
|
|
March 28, |
|
December 28, |
|
March 30, |
||||||
|
|
2020 |
|
2019 |
|
2019 |
||||||
Revenue |
|
$ |
97,316 |
|
|
$ |
100,237 |
|
|
$ |
98,091 |
|
Cost of sales |
|
|
39,754 |
|
|
|
40,944 |
|
|
|
40,439 |
|
Gross margin |
|
|
57,562 |
|
|
|
59,293 |
|
|
|
57,652 |
|
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
Research and development |
|
|
21,693 |
|
|
|
19,543 |
|
|
|
19,665 |
|
Selling, general, and administrative |
|
|
22,551 |
|
|
|
20,924 |
|
|
|
20,781 |
|
| Amortization of acquired intangible assets |
|
|
2,640 |
|
|
|
3,390 |
|
|
|
3,389 |
|
| Restructuring |
|
|
940 |
|
|
|
(55 |
) |
|
|
1,341 |
|
| Total operating expenses |
|
|
47,824 |
|
|
|
43,802 |
|
|
|
45,176 |
|
| Income from operations |
|
|
9,738 |
|
|
|
15,491 |
|
|
|
12,476 |
|
| Interest expense |
|
|
(1,077 |
) |
|
|
(1,184 |
) |
|
|
(4,987 |
) |
| Other (expense) income, net |
|
|
(50 |
) |
|
|
(228 |
) |
|
|
153 |
|
| Income before income taxes |
|
|
8,611 |
|
|
|
14,079 |
|
|
|
7,642 |
|
| Income tax expense |
|
|
444 |
|
|
|
92 |
|
|
|
234 |
|
| Net income |
|
$ |
8,167 |
|
|
$ |
13,987 |
|
|
$ |
7,408 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net income per share: |
|
|
|
|
|
|
|
|
|
|
|
|
| Basic |
|
$ |
0.06 |
|
|
$ |
0.10 |
|
|
$ |
0.06 |
|
| Diluted |
|
$ |
0.06 |
|
|
$ |
0.10 |
|
|
$ |
0.05 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Shares used in per share calculations: |
|
|
|
|
|
|
|
|
|
|
|
|
| Basic |
|
|
134,253 |
|
|
|
133,691 |
|
|
|
130,992 |
|
| Diluted |
|
|
138,044 |
|
|
|
138,196 |
|
|
|
134,810 |
|
| Lattice Semiconductor Corporation Condensed Consolidated Balance Sheets (in thousands) (unaudited) |
||||||||
|
|
|
March 28, |
|
December 28, |
||||
|
|
|
2020 |
|
2019 |
||||
| Assets |
|
|
|
|
|
|
|
|
| Current assets: |
|
|
|
|
|
|
|
|
| Cash and cash equivalents |
|
$ |
176,572 |
|
|
$ |
118,081 |
|
| Accounts receivable, net |
|
|
68,643 |
|
|
|
64,917 |
|
| Inventories |
|
|
48,932 |
|
|
|
54,980 |
|
| Other current assets |
|
|
24,531 |
|
|
|
24,452 |
|
| Total current assets |
|
|
318,678 |
|
|
|
262,430 |
|
|
|
|
|
|
|
|
|
|
|
| Property and equipment, net |
|
|
39,933 |
|
|
|
39,230 |
|
| Operating lease right-of-use assets |
|
|
22,212 |
|
|
|
23,591 |
|
| Intangible assets, net |
|
|
4,323 |
|
|
|
6,977 |
|
| Goodwill |
|
|
267,514 |
|
|
|
267,514 |
|
| Deferred income taxes |
|
|
476 |
|
|
|
478 |
|
| Other long-term assets |
|
|
11,069 |
|
|
|
11,796 |
|
|
|
|
$ |
664,205 |
|
|
$ |
612,016 |
|
|
|
|
|
|
|
|
|
|
|
| Liabilities and Stockholders' Equity |
|
|
|
|
|
|
|
|
| Current liabilities: |
|
|
|
|
|
|
|
|
| Accounts payable and other accrued liabilities |
|
$ |
67,679 |
|
|
$ |
73,650 |
|
| Current portion of long-term debt |
|
|
21,484 |
|
|
|
21,474 |
|
| Current portion of operating lease liabilities |
|
|
4,564 |
|
|
|
4,686 |
|
| Total current liabilities |
|
|
93,727 |
|
|
|
99,810 |
|
|
|
|
|
|
|
|
|
|
|
| Long-term debt, net of current portion |
|
|
170,791 |
|
|
|
125,072 |
|
| Long-term operating lease liabilities, net of current portion |
|
|
20,172 |
|
|
|
21,438 |
|
| Other long-term liabilities |
|
|
36,556 |
|
|
|
38,028 |
|
| Total liabilities |
|
|
321,246 |
|
|
|
284,348 |
|
|
|
|
|
|
|
|
|
|
|
| Stockholders' equity |
|
|
342,959 |
|
|
|
327,668 |
|
|
|
|
$ |
664,205 |
|
|
$ |
612,016 |
|
| Lattice Semiconductor Corporation Condensed Consolidated Statements of Cash Flows (in thousands) (unaudited) |
||||||||
|
|
|
Three Months Ended |
|
|||||
|
|
|
March 28, |
|
March 30, |
||||
|
|
|
2020 |
|
2019 |
||||
| Cash flows from operating activities: |
|
|
|
|
|
|
|
|
| Net income |
|
$ |
8,167 |
|
|
$ |
7,408 |
|
| Adjustments to reconcile net income to net cash provided by operating activities: |
|
|
|
|
|
|
|
|
| Depreciation and amortization |
|
|
7,793 |
|
|
|
8,403 |
|
| Stock-based compensation expense |
|
|
8,728 |
|
|
|
3,686 |
|
| Other non-cash adjustments |
|
|
1,509 |
|
|
|
2,801 |
|
| Net changes in assets and liabilities |
|
|
(5,094 |
) |
|
|
(540 |
) |
| Net cash provided by operating activities |
|
|
21,103 |
|
|
|
21,758 |
|
| Cash flows from investing activities: |
|
|
|
|
|
|
|
|
| Capital expenditures |
|
|
(3,867 |
) |
|
|
(3,074 |
) |
| Other investing activities |
|
|
(2,775 |
) |
|
|
7,916 |
|
| Net cash (used in) provided by investing activities |
|
|
(6,642 |
) |
|
|
4,842 |
|
| Cash flows from financing activities: |
|
|
|
|
|
|
|
|
| Proceeds from issuance of long-term debt |
|
|
50,000 |
|
|
|
— |
|
| Repayment of long-term debt |
|
|
(4,375 |
) |
|
|
(26,875 |
) |
| Net cash flows related to stock compensation exercises |
|
|
(1,484 |
) |
|
|
11,568 |
|
| Net cash provided by (used in) financing activities |
|
|
44,141 |
|
|
|
(15,307 |
) |
| Effect of exchange rate change on cash |
|
|
(111 |
) |
|
|
47 |
|
| Net increase in cash and cash equivalents |
|
|
58,491 |
|
|
|
11,340 |
|
| Beginning cash and cash equivalents |
|
|
118,081 |
|
|
|
119,051 |
|
| Ending cash and cash equivalents |
|
$ |
176,572 |
|
|
$ |
130,391 |
|
|
|
|
|
|
|
|
|
|
|
| Supplemental disclosure of cash flow information and non-cash investing and financing activities: |
|
|
|
|
|
|
|
|
| Interest paid |
|
$ |
1,113 |
|
|
$ |
4,383 |
|
| Income taxes paid, net of refunds |
|
$ |
852 |
|
|
$ |
280 |
|
| Lattice Semiconductor Corporation Supplemental Historical Financial Information (unaudited) |
||||||||||||
|
|
|
Three Months Ended |
||||||||||
|
|
|
March 28, |
|
December 28, |
|
March 30, |
||||||
|
|
|
2020 |
|
2019 |
|
2019 |
||||||
| Balance Sheet Information |
|
|
|
|
|
|
|
|
|
|
|
|
| A/R Days Revenue Outstanding (DSO) |
|
|
64 |
|
|
|
59 |
|
|
|
52 |
|
| Inventory Days (DIO) |
|
|
112 |
|
|
|
123 |
|
|
|
151 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Revenue% (by Geography) |
|
|
|
|
|
|
|
|
|
|
|
|
| Asia |
|
|
71 |
% |
|
|
73 |
% |
|
|
71 |
% |
| Europe (incl. Africa) |
|
|
12 |
% |
|
|
11 |
% |
|
|
12 |
% |
| Americas |
|
|
17 |
% |
|
|
16 |
% |
|
|
17 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Revenue% (by End Market) |
|
|
|
|
|
|
|
|
|
|
|
|
| Communications and Computing |
|
|
39 |
% |
|
|
38 |
% |
|
|
36 |
% |
| Industrial and Automotive |
|
|
43 |
% |
|
|
39 |
% |
|
|
37 |
% |
| Consumer |
|
|
14 |
% |
|
|
18 |
% |
|
|
20 |
% |
| Licensing and Services |
|
|
4 |
% |
|
|
5 |
% |
|
|
7 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Revenue% (by Channel) |
|
|
|
|
|
|
|
|
|
|
|
|
| Distribution |
|
|
78 |
% |
|
|
84 |
% |
|
|
79 |
% |
| Direct |
|
|
22 |
% |
|
|
16 |
% |
|
|
21 |
% |
| Lattice Semiconductor Corporation Reconciliation of U.S. GAAP to Non-GAAP Financial Measures (in thousands, except per share data) (unaudited) |
||||||||||||
|
|
|
Three Months Ended |
||||||||||
|
|
|
March 28, |
|
December 28, |
|
March 30, |
||||||
|
|
|
2020 |
|
2019 |
|
2019 |
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Gross Margin Reconciliation |
|
|
|
|
|
|
|
|
|
|
|
|
| GAAP Gross margin |
|
$ |
57,562 |
|
|
$ |
59,293 |
|
|
$ |
57,652 |
|
| Stock-based compensation - gross margin |
|
|
591 |
|
|
|
440 |
|
|
|
202 |
|
| Inventory adjustment related to restructured operations |
|
|
— |
|
|
|
— |
|
|
|
(338 |
) |
| Non-GAAP Gross margin |
|
$ |
58,153 |
|
|
$ |
59,733 |
|
|
$ |
57,516 |
|
| Gross Margin % Reconciliation |
|
|
|
|
|
|
|
|
|
|
|
|
| GAAP Gross margin % |
|
|
59.1 |
% |
|
|
59.2 |
% |
|
|
58.8 |
% |
| Cumulative effect of non-GAAP Gross Margin adjustments |
|
|
0.7 |
% |
|
|
0.4 |
% |
|
|
(0.2 |
)% |
| Non-GAAP Gross margin % |
|
|
59.8 |
% |
|
|
59.6 |
% |
|
|
58.6 |
% |
| Research and Development Expense % (R&D Expense %) Reconciliation |
|
|
|
|
|
|
|
|
|
|
|
|
| GAAP R&D Expense % |
|
|
22.3 |
% |
|
|
19.5 |
% |
|
|
20.0 |
% |
| Stock-based compensation - R&D |
|
|
(2.7 |
)% |
|
|
(1.6 |
)% |
|
|
(1.1 |
)% |
| Non-GAAP R&D Expense % |
|
|
19.6 |
% |
|
|
17.9 |
% |
|
|
18.9 |
% |
| Selling, General, and Administrative Expense % (SG&A Expense %) Reconciliation |
|
|
|
|
|
|
|
|
|
|
|
|
| GAAP SG&A Expense % |
|
|
23.2 |
% |
|
|
20.9 |
% |
|
|
21.2 |
% |
| Stock-based compensation - SG&A |
|
|
(5.7 |
)% |
|
|
(3.5 |
)% |
|
|
(2.4 |
)% |
| Non-GAAP SG&A Expense % |
|
|
17.5 |
% |
|
|
17.4 |
% |
|
|
18.8 |
% |
| Operating Expenses Reconciliation |
|
|
|
|
|
|
|
|
|
|
|
|
| GAAP Operating expenses |
|
$ |
47,824 |
|
|
$ |
43,802 |
|
|
$ |
45,176 |
|
| Stock-based compensation - operations |
|
|
(8,137 |
) |
|
|
(5,124 |
) |
|
|
(3,484 |
) |
| Amortization of acquired intangible assets |
|
|
(2,640 |
) |
|
|
(3,390 |
) |
|
|
(3,389 |
) |
| Restructuring charges |
|
|
(940 |
) |
|
|
55 |
|
|
|
(1,341 |
) |
| Impairment of acquired intangible assets |
|
|
— |
|
|
|
— |
|
|
|
1,023 |
|
| Non-GAAP Operating expenses |
|
$ |
36,107 |
|
|
$ |
35,343 |
|
|
$ |
37,985 |
|
| Income from Operations Reconciliation |
|
|
|
|
|
|
|
|
|
|
|
|
| GAAP Income from operations |
|
$ |
9,738 |
|
|
$ |
15,491 |
|
|
$ |
12,476 |
|
| Stock-based compensation - gross margin |
|
|
591 |
|
|
|
440 |
|
|
|
202 |
|
| Inventory adjustment related to restructured operations |
|
|
— |
|
|
|
— |
|
|
|
(338 |
) |
| Stock-based compensation - operations |
|
|
8,137 |
|
|
|
5,124 |
|
|
|
3,484 |
|
| Amortization of acquired intangible assets |
|
|
2,640 |
|
|
|
3,390 |
|
|
|
3,389 |
|
| Restructuring charges |
|
|
940 |
|
|
|
(55 |
) |
|
|
1,341 |
|
| Impairment of acquired intangible assets |
|
|
— |
|
|
|
— |
|
|
|
(1,023 |
) |
| Non-GAAP Income from operations |
|
$ |
22,046 |
|
|
$ |
24,390 |
|
|
$ |
19,531 |
|
| Income from Operations % Reconciliation |
|
|
|
|
|
|
|
|
|
|
|
|
| GAAP Income from operations % |
|
|
10.0 |
% |
|
|
15.5 |
% |
|
|
12.7 |
% |
| Cumulative effect of non-GAAP Gross Margin and Operating adjustments |
|
|
12.7 |
% |
|
|
8.8 |
% |
|
|
7.2 |
% |
| Non-GAAP Income from operations % |
|
|
22.7 |
% |
|
|
24.3 |
% |
|
|
19.9 |
% |
| Lattice Semiconductor Corporation Reconciliation of U.S. GAAP to Non-GAAP Financial Measures (in thousands, except per share data) (unaudited) |
||||||||||||
| Income Tax Expense Reconciliation |
|
|
|
|
|
|
|
|
|
|
|
|
| GAAP Income tax expense |
|
$ |
444 |
|
|
$ |
92 |
|
|
$ |
234 |
|
| Estimated tax effect of non-GAAP adjustments (1) |
|
|
280 |
|
|
|
(11 |
) |
|
|
(98 |
) |
| Non-GAAP Income tax expense |
|
$ |
724 |
|
|
$ |
81 |
|
|
$ |
136 |
|
| Net Income Reconciliation |
|
|
|
|
|
|
|
|
|
|
|
|
| GAAP Net income |
|
$ |
8,167 |
|
|
$ |
13,987 |
|
|
$ |
7,408 |
|
| Stock-based compensation - gross margin |
|
|
591 |
|
|
|
440 |
|
|
|
202 |
|
| Inventory adjustment related to restructured operations |
|
|
— |
|
|
|
— |
|
|
|
(338 |
) |
| Stock-based compensation - operations |
|
|
8,137 |
|
|
|
5,124 |
|
|
|
3,484 |
|
| Amortization of acquired intangible assets |
|
|
2,640 |
|
|
|
3,390 |
|
|
|
3,389 |
|
| Restructuring charges |
|
|
940 |
|
|
|
(55 |
) |
|
|
1,341 |
|
| Impairment of acquired intangible assets |
|
|
— |
|
|
|
— |
|
|
|
(1,023 |
) |
| Estimated tax effect of non-GAAP adjustments (1) |
|
|
(280 |
) |
|
|
11 |
|
|
|
98 |
|
| Non-GAAP Net income |
|
$ |
20,195 |
|
|
$ |
22,897 |
|
|
$ |
14,561 |
|
| Net Income Per Share Reconciliation |
|
|
|
|
|
|
|
|
|
|
|
|
| GAAP Net income per share - basic |
|
$ |
0.06 |
|
|
$ |
0.10 |
|
|
$ |
0.06 |
|
| Cumulative effect of Non-GAAP adjustments |
|
|
0.09 |
|
|
|
0.07 |
|
|
|
0.05 |
|
| Non-GAAP Net income per share - basic |
|
$ |
0.15 |
|
|
$ |
0.17 |
|
|
$ |
0.11 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| GAAP Net income per share - diluted |
|
$ |
0.06 |
|
|
$ |
0.10 |
|
|
$ |
0.05 |
|
| Cumulative effect of Non-GAAP adjustments |
|
|
0.09 |
|
|
|
0.07 |
|
|
|
0.06 |
|
| Non-GAAP Net income per share - diluted |
|
$ |
0.15 |
|
|
$ |
0.17 |
|
|
$ |
0.11 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Shares used in per share calculations: |
|
|
|
|
|
|
|
|
|
|
|
|
| Basic |
|
|
134,253 |
|
|
|
133,691 |
|
|
|
130,992 |
|
| Diluted - GAAP (2) |
|
|
138,044 |
|
|
|
138,196 |
|
|
|
134,810 |
|
| Diluted - Non-GAAP (2) |
|
|
138,044 |
|
|
|
138,196 |
|
|
|
134,810 |
|
| (1) |
|
We calculate non-GAAP tax expense by applying our tax provision model to year-to-date and projected income after adjusting for non-GAAP items. The difference between calculated values for GAAP and non-GAAP tax expense has been included as the “Estimated tax effect of non-GAAP adjustments.” |
| (2) |
|
Diluted Shares are calculated using the GAAP treasury stock method. In a loss position, diluted shares equal basic shares. |
